Storage Location or Storage type

Question

Hi Experts ,
Here is the complete scenario .....
<b>W1</b> -- Warehouse1 which has Supplies and Pharma
<b>W2</b> -- Warehouse 2 which has Supplies and Equipments
<b>W3</b> -- Warehouse 3 has Pharma only
<b>W1 and W3 are in one Physical structure with partition
W2 is across the road...</b>
1. Supplies move from W2 to W1 when supplies go low in warehouse 1 (W1) this is <b>done almost daily</b> .
2. Supplies from W1 are moved to W2 if there is any overflow or supplies come in excess which happens <b>few times a week</b>.
3. We have  <b>3 shipment points</b> where they perform shipping and receiving each for W1,W2 and W3.
4. we have 6 staging spots for staging of international shipments on W1
   and we have about 10 staging spots in W2 ....We need to know the exat location of where the shipping pallet is located for compliance purpose (Inspection )
5. Most of the receiving is done in <b>W1 (about 85 %) </b>where it is inspected , arranged and then put away is done accordingly ....
     If the shipment contains only equipments or Beds then its received  in W2.
6. When there is an<b> overflow of Pharma in W1</b> then some of the supplies in W1 are removed and put in W2 so that they get space for Pharma storage .....
7.  Warehouse 3 (W3) has high value  Pharma, basically used for domestic shipments (in US) or the pharma products which dont have space in W1.
8..  Moving of Pharma products for storage  from <b>W3 to W1  happens rarely</b>;
9.  Moving from W1 to W3 happens <b>almost daily</b> ..cause when ever the products get over in W3 then they move it from W1.
10.  Picking for international shipments takes place from W3 and W1 and are shipped from W1 in big Pallets.
11.  When they receive the product in Big pallets in W1 some pharma products go to W1 and some in W3 , depending on the value .
12.   Some times the domestic Shipments are in  large quantity so its taken  from W3 to W1 and staged for shipment in W1.
13.  Domestic (within US) shipments is done through Fed Ex ....which is <b>done daily ....</b>
My Question is will it be wise to
<b>OPTION 1:</b>make these 3 warehouses into <b>3 storage locations.</b>..(1 plant >3storage locations>1 warehouse )or
<b>OPTION 2:</b> is it wise to make these 3 warehouses into <b>3 storage types ......</b>  (1plant --->1 storage location --->1 warehouse -
>3 storage types -->1 section under each storage type )
Will there be any problem to define <b>shipping point,carry physical inventory,stock transfers and work with RF devices</b> in future if i choose<b> option 2 </b>
Your Advise is precious to me ....Please do let me know the <b>pros and cons</b> .....for options ..above ....
Regards
Albert

Answer 1

Hello Albert,
It's always suggested to have very simple organization structure so we can avoid extra transaction.
Now in your case, if you define three Plant/SLoc/warehouse then you are going to end up with more and more transactions at inventory level and followed by warehouse transactions.
I suggest to have one Sloc and one warehouse for this kind of organization and maintain different storage type for each physical location. This will reduce the IM level transactions. Now when moving material from one facility to another facility you can maintain one more storage type for the Transport Equipement (i.e. Cart/Forklift etc) so when you move from W1 to W2 at that time you can do bin to bin transfer.
Also you want facility for overflow in one facility so this can be achieved with allowing two storage type for putaway.
for different kind of Supplies and pharma, I am sure you will plan different material type for them so that will help to get reports for each category.
Hope this helps.
Regards
Arif Mansuri